Tag Archives: Corporations

Corporations Aren’t Parasites

Posted on by
Reply

People who dismiss the unemployed and dependent as “parasites” fail to understand economics and parasitism. A successful parasite is one that is not recognized by its host, one that can make its host work for it without appearing as a burden. Such is the ruling class in a capitalist society. – Jason Read

Associate Professor Read’s catchy word-bite is making the rounds of gullible Facebookers. Read’s quote and blog seem to advocate for the intersection of modern Communization and the anarchistic breakdown of traditional culture; in short he is an ivory tower Occupier. As with Jeffrey Clements’s middling book Corporations Are Not People, a little thought reveals that corporations and capitalism reflect the highest ambitions of, and are the only mechanism that allows for, the wealth they take for granted.

So, what is a corporation? A corporation is a voluntary agreement between different sorts of people so that they may work together. A single family might be able to build a log cabin, raise some livestock, and spin wool to make clothes, but that is the limit. Civilization, a concept not especially well received by the Occupiers, requires the specialization of skills, which requires trade between those specialists. Today, it is commonly assumed that everyone is a specialist (e.g. plumber, lawyer, engineer), but for the vast majority of human existence, nearly everybody shared the same skills with his neighbors.

Specialization leads to the need for a corporation. Truly huge endeavors require more than specialized laborers, they require capital and management (i.e. ideas). For example, a jet airplane certainly requires a variety of specialists such as metalworkers and electricians to construct, but its design and planning also require the equivalent of thousands of lifetimes of labor before the first spar is set. How can those who would realize their idea for a new jet marshal the massive resources required just to get to the start of construction? Capital formation.

Contrary to Mr. Read’s sophistry, capital is always formed by a combination of someone working harder and spending less than his neighbors. He might then give it to his children, or it might be taken by thieves and taxes, but it started with work and savings. His savings, which came through sacrifice, are precious to him, so he wants to protect them. The capitalist would never simply give his money to any person with an idea for a new jet; indeed hardly any one person has enough capital to fund such a project.

The corporation is a means by which a large number of capitalists, or savers, can join together with labor specialists and a manger with an idea to create something none of these groups could on its own. The capitalist (saver) is protected from the errors of the manager beyond his investment. The manger is protected from liability should the venture fail. The laborers are largely protected from the responsibility for what they have built and can receive compensation now rather than years in the future. Without such an arrangement, established by law, truly big and beneficial ventures would be impossible. Corporations are a voluntary pact between managers with an idea, labor with specialized skills, and capitalists with savings to invest. And, absent government action such as bailouts, nobody outside of the corporation is at risk to lose his money. By the way, Mr. Clements, these are all people.

The absence of this voluntary pact is the communism that Mr. Read seems to embrace. Communist systems replace the capitalist and manager with parasite politicians. Politicians decide where to allocate labor, while savings and investment are outlawed. The result is proven and predictable – stagnation and eventual collapse. Most disheartening is the academics such as Mr. Read who should know the sickening track record of communism.

The corporation is the intersection of savers looking for the best place to employ their capital, managers seeking to profit from ideas and innovation, and laborers looking for the highest pay in exchange for their skills. The corporation is for people and by people, and it is the ultimate expression of the potential of capitalism. It is voluntary and there are no parasites. One only need visit communist China to see the parasites – party members with soft hands perpetually taking bribes. To the extent that US capitalism and corporations are corrupt, look to government graft and coercion. GE, GM, and Solyndra are not voluntary capitalism, they are government sponsored corruption. Comparatively free corporations like Microsoft, Facebook, or the humble local florist create the wealth that feeds their critics like Mr. Read and Mr. Clements.

Yes, They Are Communists

Posted on by
4

The delightfully salacious political news lately has been the ‘Occupy’ movements around the world. Shout Bits has visited the Denver, CO rallies and can confirm one part of the Old Time Media reports – yes, they smell brutally offensive with BO. But the OTM is willfully ignoring another obvious fact – these protesters are of the same cloth as the communists that sought to revolutionize the US in the late 1960′s and early 1970′s. Their message is violence and repression, not some sort of peace and love.

Anyone who did not live through the 1968 Chicago DNC should read Dupes by Paul Kengor. In it, he combines commonly understood cold war history with later released KGB files to expose organizations such as trade unions, academic luminaries, and student anti-war organizations as indeed infiltrated by communists who took direct orders and funding from Moscow. Just as Sen. McCarthy suspected, the State Department did have communist agents occupying high positions of authority. 1960′s radical groups like SDS and the Weather Underground were in fact run by violent communists.

One of the interesting twists of revolutions is that they usually feed on their own. The 1960′s radical movement peaked under the far left President that gave the nation Medicare and the War on Poverty. Giving revolutionaries what the logically should want only emboldens them to pursue their ultimate end – in this case the abolition of private property and the dictatorship of the proletariat (i.e. communism). While Pres. Obama is a socialist from the European mold, the ‘Occupy’ troops clearly want more.

Goofy Message


Scary Messages
(side note: Deep Green Resistance is a communist organization that “believes that civilization, and especially industrial civilization, is fundamentally unsustainable and must be actively dismantled in order to secure a livable future for all species on the planet”)

Listen to the words of the protesters and consider their tactics; the OTM likes to pretend that these people do not have specific messages or demands, but they do. Democrats like Rep. Pelosi and Pres. Obama are seeking to align themselves with these groups to gain from their activism, but the message on the street is very different from the one filtered by the OTM. The street crowds want an end to capitalism and the current government as we know it; they do not want reform, they want revolution. They want corporations abolished and wealth redistributed. Socialism seeks to contain capitalist spirits, while communism seeks to abolish capitalism altogether. The ‘Occupy’ movement is communist.

But didn’t communism end with Sen. McCarthy, or the Chicago DNC, or at least with the Berlin Wall? Without funding and direction from Moscow, how could communism survive? Communism did not die, rather 1960′s communist radicals hid their stripes and turned to academia. Bernadine Dohrn, communist murderer, escaped the FBI’s top ten list and became a law professor at Northwestern University. Communist Noam Chomsky (self-described Anarchist, but truly a communist) was already an academic in the 1960′s, and after encircling the Pentagon completed his career at MIT. Communist terrorist Bill Ayers somehow escaped the death penalty and went on to be a professor at the University of Illinois (and a friend of Barak Obama). Communist terrorist Michael Klonsky also became a University of Illinois professor. Communist terrorist and ‘Che’ Guevara acolyte Mark Rudd fled the FBI in the 1970′s, but later taught math at Albuquerque Votech. The list goes on, but communists and their sympathizers escaped to academia where they have bread a new generation of useful idiots for their cause. The preponderance of college hippies at the marches shows that Marxism and communism are alive and well at the ivory towers.

Even though communism promised race equality, it produced horrific ethnic cleansing in places like China and Kazakhstan. Even though communists claim to be for free speech and assembly, only capitalist nations allow such rights. Even though communists call themselves democratic, the only tool of communist expansion is violence. Communists promise wealth equity, but they simply deliver poverty and starvation on a scale that has killed 100 million people or more. The promise of peace is met with the reality of genocide. The OTM should stop carrying water for the communists who are driving the ‘Occupy’ movement. Voters should recognize the protesters’ message and tactics as those of the 1960s’ radicals that sought the violent overthrow of the US, and ask why prominent politicians are aligning with these dangerous people. It only takes a little moral clarity to understand that the ‘Occupy’ protesters do not represent any traditional US value or aspiration.

Steve Jobs – A Life In Failure

Posted on by
2

This week Apple co-founder Steve Jobs passed away after a lengthy battle with cancer. As a household name, people naturally mourned the man most had never met. Like his historical comparison, Thomas Edison, Jobs was a brash provocateur, did little of the hands-on inventing in his shop, enjoyed a non-conventional libation, and he oversaw monumental failures. Jobs’s sometimes nemesis, Bill Gates, has many of the same type-A traits, but Microsoft was essentially forbidden to fail, and that is the reason Apple is worth 25% more than Microsoft today.

Failure is the common thread among all great innovators. Edison’s monumental failure was his DC power grid. Westinghouse won the battle to electrify the nation with AC power – a vastly superior technology, yet Edison remains the greatest inventor of his time. Jobs’s failures were epic – the Lisa, Next Computer, the first portable Mac. Under different leadership, Apple also produced the Newton and other disasters. Unlike anything else, failure focuses the mind, redirects resources, and redoubles creative efforts. Most triumphs rise from the rubble of colossal failure. In Apple’s case, it teetered on the brink of insolvency at the end of 2000, only to become the most valuable publicly traded company today.

Microsoft also had its share of failures – Windows Me, Clippy, a host of failed applications. Microsoft’s early history was that of producing a poor first effort, but constantly improving until it dominated the market. The paths of Jobs and Gates diverged when the Government decided Microsoft was too successful. In 1998, a group of AGs and the DOJ responded by shackling Microsoft’s creativity; Microsoft essentially had to clear each new idea or product with government bureaucrats. Anything that might leverage Microsoft’s strengths in the market was forbidden. Microsoft had become akin to a public utility – profitable, but low growth and no innovation. Without the prospect of success, the risks of failure seem too great, and innovation at Microsoft tailed off.

To be sure, Microsoft employees continued to invent new technologies. Microsoft pioneered the tablet PC, touch screen smart phones, speech recognition built into Windows, and a wealth of patents. But Microsoft never bet the farm on any of these innovations, and they never dominated their markets. Most notably, Apple now dominates the tablet market that Microsoft launched a decade ago. Without the incentive and freedom to risk failure, Microsoft lost its way. Now that government oversight has been lifted, Microsoft is aggressively pursuing the markets it pioneered – smart phones and tablet PCs. The freedom to fail is the power to innovate and make the world better.

Shout Bits has argued against government interference in the creative process before, but the story of Steve Jobs is the promise of US exceptionalism, while the story of Microsoft is the decline of innovation when the government disallows failure. Jobs lead the true American life. He failed over and over; his life took as many turns as his short years allowed. He founded a Fortune 500 company, lost it, and eventually rebuilt it. Along the way, he revolutionized computers, movies, music, and telephony. Whenever Jobs took on an industry, those working for the established norm packed their bags.

On the other hand, while Microsoft started out disrupting industries with aggressive risk taking, later it was ensnared by government dictates on what was ‘fair.’ The careers of Jobs and Gates are a cautionary tale to anyone who might believe the government should allocate investments or somehow decide which ideas are to succeed. Even if Pres. Obama had picked a winner in Solyndra, the heavy hand of government would have foreclosed on someone else with an even better idea. Steve Jobs’s career was a celebration of the US’s unique capacity to tolerate the failures that eventually lead to the innovations that build the modern world.

Joe Alfieri liked this post